Question
The following data represent the probability distribution of the holding period returns for an investment in Lazy Rapids Kayaks (LARK) stock. State of the Economy
The following data represent the probability distribution of the holding period returns for an investment in Lazy Rapids Kayaks (LARK) stock.
| State of the Economy | Scenario #(s) | Probability, p(s) | HPR |
| Boom | 1 | 0.340 | 33.20% |
| Normal growth | 2 | 0.420 | 8.40% |
| Recession | 3 | 0.240 | -19.20% |
a. What is the expected return on LARK? (Round your answer to 2 decimal places.)
b. What is the standard deviation of the returns on LARK?
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Intermediate Accounting Volume 2
Authors: Thomas H. Beechy, Joan E. Conrod, Elizabeth Farrell, Ingrid McLeod-Dick, Kayla Tomulka, Romi-Lee Sevel
8th Edition
1260881245, 9781260881240
